Tax White Papers

The IRS test often is termed the “right-to-control test” because each factor is designed to evaluate who controls how work is performed. Under IRS rules and common-law doctrine, independent contractors control the manner and means by which contracted services, products, or results are achieved. The more control a company exercises over how, when, where, and by whom work is performed, the more likely the workers are employees, not independent contractors.

Insurance agents and others sell 412i, 419, captive insurance and section 79 scams to unsuspecting business owners. The IRS considers many of these plans abusive tax shelters, listed transactions, reportable transactions, or what it calls "similar to," which allows them to target the plan. The unsuspecting business owners then get audited by the IRS, lose their deductions, and pay interest and penalties. Then comes the bad news. The IRS comes back and fines the business owners a large amount of money for not properly filing under IRC 6707A. They have even fined hundreds of business owners who have filed. The IRS says that they prepared the forms incorrectly or filed improperly, or lied to the IRS.

To elect and continue S corporation status the corporation and its shareholders must meet a number of basic requirements. Under IRC Section 1361, only a "small business corporation" can operate as an S corporation.

A brief review of the new and improved features and tools available for
QuickBooks Pro 2011, QuickBooks Premier 2011, QuickBooks Enterprise Solutions 11.0

The EGTRRA phased-out the estate and generation-skipping transfer taxes so that they were fully repealed in 2010, and lowered the gift tax rate to 35 percent and increased the gift tax exemption to $1 million for 2010. In 2011 the estate, gift and GST tax exclusion was scheduled to decline to $1 million and the estate, gift and GST tax rate to rise to 55%.

The Senate passed late December 9th the "Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010" ("Bill") that provides temporary estate, gift and generation skipping transfer tax relief. The Bill‟s objective is, among significant other matters, to address the expiration of significant tax reductions from prior legislation that absent the Bill would result in significant income tax increases, especially with respect to the estate, gift and GST taxes. The prior legislation in issues is for transfer tax purposes the Economic Growth and Tax Relief Reconciliation Act of 2001 (EGTRRA), including certain modifications contained in the American Recovery and Reinvestment Act. The Bill also addresses expiring tax cuts in the Jobs and Growth Tax Relief Reconciliation Act of 2003 (JGTRRA).

Form 1099 is a series of forms used in the United States income tax system by the Internal Revenue Service (IRS) to prepare and file an information return under Internal Revenue Code Section (IRC) 6041